PUBLIC sector workers have been offered a new pay increase deal of seven per cent for the 2015-2017 fiscal period.

The new offer breaks down to a four per cent increase effective from April 1, 2015, and a further three per cent increase effective April 1, 2016. This arrangement is up from the original offer of three per cent and two per cent which was made in March and was rejected by the workers.

Minister with responsibility for the public service, Horace Dalley, told the Jamaica Observer last night he is optimistic that the offer will lead to a settlement of the prolonged public sector wage issue by the latest month-end.

“We have never had much of a problem with the fringe benefits, because some are not aligned with the wage costs. The problem has always been the basic pay, and we want to ensure that anything we offer we will be able to pay it and we don’t go beyond the limit that will ensure that we meet the nine per cent of GDP target,” the minister said.

The offer is a small step from the rejected five per cent, but the trade unions leaders feel that they have something substantive to put to their members.

Trade unionist, Lambert Brown, who is a member of the Jamaica Confederation of Trade Union’s (JCTU) negotiating team, said that the new offer from the minister confirmed his position that where there is a will there is a way.

“We can always find appropriate ways to resolve these issues,” Brown said.

But, other union representatives were more cautious, pointing out that they were not sure how their members would respond.

President of the Jamaica Teachers’ Association, Doran Dixon, said that there will be meetings in Clarendon, Manchester, St Catherine, and Kingston to relay the new offers to the teachers and get their response.

Several meetings are also planned by the JCTU team, which represents 11 trade unions and over 40,000 government workers.

The increased offer has emerged in the midst of protest action by the members of the Jamaica Constabulary Force, which began on Tuesday, and widespread two-hour demonstrations by teachers on the job.

At the end of March, the unions rejected the Government’s initial pay increase offer of three per cent and two per cent in the first and second years, respectively, of a new three-year agreement. The previous agreement, which ended on March 31, included a freeze on wages and lasted for three years (2012-2015).

The Government was hoping to start the negotiations last October in order to conclude by the end of the financial year 2014/15 (March 31), but relaxed the timeline after the International Monetary Fund agreed to extend the deadline for an Extended Fund Facility benchmark provision to reduce public sector wage bill to below nine percent of the country’s gross domestic product to March, 2017.

The estimated public sector wage bill for 2014/15 was $161.7 billion, a three per cent increase over the figure for 2013/14. That increase was attributed to payment of performance increments, a $25,000 one-off payment to the workers in each year of the contract and implementation of new rates associated with the reclassification of health sector workers.

The Government has included some $165 billion in the 2015/16 budget for wages and salaries, which is four per cent higher than last year’s wage bill.

The West Indies Group of University Teachers (WIGUT) has insisted that between the $11 billion budgeted in 2014/15 for contingencies related to the one-off payment, and the settlement of some outstanding claims as well as some $10 billion included for payment of GCT on government purchases, there is enough money in the budget to meet the pay claims by the unions.